How corruption is stifling Africa’s growth

Once again, the Corruption Perceptions Index results are not fundamentally different from previous years: the majority of African countries still have a score of less than 50 per cent, which in our view depicts a situation of endemic corruption.

In a continent with high level of economic growth rates (compared to many parts of the world), the persistence of widespread corruption is one of the factors inhibiting the transformation of the economic growth into development dividends for all citizens, preventing them from enjoying improved livelihoods and living conditions.

It should be a matter of global concern that while citizens in Africa are confronted with corruption to access poor basic services, illicit financial flows from Africa are quickly draining the continent and depriving African countries of resources for investment and development. Currently, illicit financial flows from Africa exceed combined inflows from official development assistance. The UN Economic Commission for Africa estimates that the annual outflow of illicit finance through trade mispricing alone stands at about US$60 billion, having grown at a real rate of 32.5 per cent in the decade between 2000 and 2009. This estimate stands higher than outflows from other developing regions. Illicit financial flows are a serious threat to Africa’s economic growth and development. This situation needs to stop and it is a global responsibility to stop it.

There is a growing awareness of the importance of transparency, participation and accountability for sustainable development gains. As negotiations for Sustainable Development Goals draw to a conclusion, African leaders and citizens should mobilise to ensure a global consensus for a goal on effective, transparent and inclusive institutions. In Africa, now more than ever before, governments, companies and citizens should work together to ensure Africa’s development is premised on real transparency, accountability and participation.

This article is published in collaboration with Transparency International. Publication does not imply endorsement of views by the World Economic Forum.

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Author: Chantal Uwimana is Regional Director for Africa and the Middle East at Transparency International.

Image: A money changer counts U.S. dollar bills at a currency exchange in Manila January 15, 2014. REUTERS/Romeo Ranoco